TMI Blog2018 (8) TMI 1689X X X X Extracts X X X X X X X X Extracts X X X X ..... eing fulfilled in the present case. Negative list - Section 66D of the Finance Act, 1994 - case of appellant is also that their activity are also covered by Section 66D of the Finance Act, 1994 which covers the negative list of items which are exempted from the levy of service tax - Held that:- The activities which are covered under Section 66D (a) are of the nature which are purely in the public interest and undertaken as a mandatory and statutory function. We find that the appellant is a body which is not a local authority and therefore the exemption under Section 66D (a) is not available to them - the shops which are rented by the appellant for business does not fall under the negative list under Section 66D (d) of Finance Act, 1994. The provisions of Section 66D (d) (iv) of the Finance Act, 1994 only provides when the agriculture land is used for agriculture or for its producers but not for shops which are used for carrying out business or commerce - thus, the activity of renting of phars/tin sheds/shops for marketing/trading of flowers etc. by the traders is taxable under the category of renting of immovable property. Leviability of service tax under the extended time - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve-mentioned service tax amount have been confirmed and penalties under the various sections including Section 78 of the Finance Act, 1994 have been imposed. The appellant have gone in appeal before Commissioner (Appeals) against the above mentioned order of the Additional Commissioner and the learned Commissioner (Appeals) has also upheld the order of lower authority. The appellants are before us against the above-mentioned order of Commissioner (Appeals). The learned Advocate appearing on behalf of the appellants has pleaded that Flower Marketing Committee is discharging statutory functions as prescribed under Delhi Agricultural Produce Marketing Act, 1998. The learned Advocate has also pleaded that the appellant have only provided the vacant land on which Phars or temporary structures have been constructed by the traders themselves in the form of tin sheds etc. and therefore the appellant have not provided any service of renting of immovable property as defined under Section 65 (105) (zzzz) of the Finance Act, 1994. It has also been contended that under Section 66D of the Finance Act, 1994 under sub-clauses (a) and (d), the activity pertaining to agricultural and local bodies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tmental Representative who has reiterated the findings as given in the order-in-appeal. 3. We have heard both the sides and perused the record of appeal. 4. It is a matter of record that the appellant have provided phars/tin sheds on charging of a licence fee in the flower marketing yard at Gazipur. The licence fee for Phars /Tin Sheds is chargeable on monthly basis and they have not paid any service tax on the amounts recovered as lease fee/rent from the various traders using the premises of the appellant. As per the provisions of Finance Act, 1994 the activity of the rent of immovable property is specifically covered under Section 65 (105) (zzzz) wherein it has been provided that :- to any person, by any other person, by renting of immovable property or any other service in relation to such renting, for use in the course of or, for furtherance of, business or commerce. Explanation 1. - For the purposes of this sub-clause, immovable property includes :- (i) building and part of a building, and the land appurtenant thereto; (ii) land incidental to the use of such building or part of a building; (iii) the common or shared areas and facilities re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmanent/immovable nature and therefore the above activity certainly falls under the category of renting of the immovable property and therefore rightly taxable under this classification. 6. Now coming to the next argument of the learned Advocate that their activity are also covered by Section 66D of the Finance Act, 1994 which covers the negative list of items which are exempted from the levy of service tax. The learned Advocate has primarily argued that they are covered by the provisions of Section 66D (a) and 66D (d). The Relevant Sections are reproduced here below :- SECTION [66D. Negative list of services. - The negative list shall comprise of the following services, namely :- (a) services by Government or a local authority excluding the following services to the extent they are not covered elsewhere- [(i) * * * * ] (ii) services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport; (iii) transport of goods or passengers; or (iv) [Any service], other than services covered under clauses (i) to (iii) above, provided to business entities; Section 66D. (d) services relating to agriculture o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bordinate authorities confirming the service tax on the amounts collected by the appellant from various traders towards lease fee or rent. 9. Now coming to the question of leviability of service tax under the extended time proviso under Section 73 (1) of the Finance Act, 1994 as well as levy of penalty under Section 78 of the Finance Act is concerned, we agree with the learned Advocate that the ingredients of intention to evade service tax are certainly missing in this case and there have been genuine confusion regarding the leviability of service tax on the rents collected by the various agricultural produce marketing boards/committees in this regard. We follow the Hon ble Supreme Court judgment in the case of Padmini Products vs. CCE, Bangalore (supra) and hold that extended time proviso in this case is not legally invokable in this case. We also hold that penalty under Section 78 of the Finance Act, 1994 is also not invokable in this case. The appeals are accordingly decided. The appeals are therefore allowed by way of remand to the Original Adjudicating Authority with the following direction :- (i) demand of service tax need to be confirmed for all the show cause notices ..... X X X X Extracts X X X X X X X X Extracts X X X X
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